Brius whistleblower said Rechnitz knew about kickback scheme

The money-for-patients kickback scheme that resulted in a multi-million penalty against California’s largest nursing home operator may have been far more pervasive than prosecutors indicated when they announced a settlement last month, court records show.

In her original whistleblower complaint, obtained by BriusWatch, Viki Bell-Manako, alleged that Brius brass including CEO Shlomo Rechnitz were informed of the kickback scheme and that it extended to multiple hospitals in and around San Diego.

Bell-Manako, a former marketing director at a Brius home in San Diego, described Brius officials treating Medicare patients as a commodity to be purchased with bribes, because they generate far higher reimbursement rates than non-Medicare patients.

To secure Medicare patients, the whistleblower alleged that Brius:

  • Put hospital workers on the company payroll with some making $1,000 a month in return for referrals of Medicare patients.
  • Paid a manager at Kindred Hospital $4,000 per month to refer Medicare patients to Brius homes
  • Transferred Medi-Cal patients to other facilities to open beds for Medicare patients
  • Hosted parties for hospital case managers who referred Medicare patients to Brius homes.

Moreover, Bell-Manako said that Brius officials didn’t just bribe hospital workers for lucrative patients; they also pocketed cash kickbacks from a home health agency in exchange for referring patients exiting Brius homes.

Bell-Manako said in court papers that she personally informed Rechnitz of her concerns and that one of the key figures behind the scheme was Guy Reggev, a partner of Rechnitz’s in several of his nursing homes.

Reggev had his mother, Judy Reggev, “go to the floor of Scripps-Mercy (Hospital) with a cart full of snacks food and water to give to all the case managers,” according to the complaint. Two hospital workers, at one pointed, flew to New York to visit Ms. Reggev at her home.

Bell-Manako’s complaint triggered a federal investigation into Brius’ operations in San Diego that ended last month when Brius agreed to pay up to $6.9 million to resolve kickback and fraud allegations.

However, Brius did not admit guilt to many of the accusations made by the whistleblower in its settlement with federal prosecutors. The company only admitted to offering kickbacks at Scripps Mercy Hospital San Diego, and claimed that Brius officials were unaware of employees using corporate credit cards to buy hospital workers gift cards, massages, tickets to sporting events and a Hornblower cruise.

In her complaint, Bell-Manako said the kickback operation extended to seven San Diego hospitals, and that she made a personal visit to Rechnitz’s home to express her concern about it. She also said that the company rewarded marketing directors who participated in the kickback scheme with free cars, including Lexus and Mercedes SUVs.

Additionally, she claimed that Brius paid a doctor to refer Medicare patients to its nursing homes. According to the complaint, the doctor provided so many patients that two homes had to “transport Medi-Cal patients to alternate facilities to make room for the higher compensation Medicare referrals.”

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